IBM retains top position for patents

INNOVATION The firm registered the most US patents last year, while HP moved up a spot, in line with the company's drive to boost licensing revenue

BLOOMBERG

IBM Corp, the world's biggest computer company, topped the list of companies receiving US patents for the 12th year in a row.

IBM received 3,248 patents last year, 167 less than in 2003, according to preliminary figures released yesterday by the US Patent and Trademark Office, based in Alexandria, Virginia.

As in past years, the 10 recipients of the most patents are technology-related companies, including five based in Japan, four in the US and one in South Korea.

Companies with the most patents can use the ranking to promote themselves as being at the forefront of technological innovation, said Brad Wright, an attorney who helps firms obtain patents.

Licensing Revenue

More patents also can translate to higher revenue from licensing technology to competitors.

"They have a sort of fear factor with companies like IBM or other companies that have thousands of patents," Wright said. "The target licensees frequently are persuaded by the sheer raw number of patents."

Dutch electronics company Royal Philips Electronics NV dropped off the top-10 list from last year and Japan's Toshiba Corp joined it.

Technology patents can take as long as three years to process, compared with an average of two years for all other categories. IBM, which is selling its personal-computer business, has relied on advances in nanotechnology and computer services to stay on top of the list. The company has one of the world's largest patent portfolios and spent US$5.1 billion in research in 2003, the most recent year for which figures are available.

IBM spokesman Chris Andrews didn't return calls seeking comment.

HP Improves

Hewlett-Packard Co, which rose to fourth place from fifth place in its third year on the list, has made patents a top priority. The company rewards employees for proffering ideas, and it set up a licensing program to increase revenue.

"We're improving our position from a standpoint of income from outlicensing activities," said Steve Fox, vice president and deputy general counsel for intellectual property for Hewlett-Packard. Being on the list is "an objective because what it shows relative to the other technology companies is that we're doing the right thing."

The US government received 829 patents, just more than half the number received by Sony Corp, which ranked No. 10.

Semiconductor companies Intel Corp and Micron Technology Inc made the list because "they protect even small advances in their technology," said David Klein, a patent lawyer who handles licensing issues.

Other companies with the most patents tend to focus on a wider range of products, he said.

Fewer, more valuable patents sometimes deliver higher sales than a large tally. Pfizer Inc, the world's largest drug maker, has only five patents covering the cholesterol drug Lipitor.